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Trading volumes hit a record high and around $2 trillion was wiped off global stocks after Britain surprised financial markets by voting to leave the European Union.

The pound collapsed to a three-decade low and the FTSE 100 plunged 8.7pc within minutes of the opening bell as traders endured the most treacherous rollercoaster ride since the height of the financial crisis in 2008.

An offering of more than £250bn to ease any squeeze in markets from Bank of England governor Mark Carney softened the Brexit blow, lifting London’s benchmark index from the doldrums.

Pound plunges to 31-year low on Brexit voteCredit:
Bloomberg

The reassurance from the central bank also helped steady the pound in afternoon trade, which hovered around 2009 lows of 1.373 against the dollar. Although it dipped back to 31-years lows of $1.363 as London stock markets closed.

By close, the FTSE 100 had narrowed its losses, down 199.41 points, or 3.15pc, to 6,138.69, wiping more than £50bn of the value of Britain’s biggest companies. The remarkable recovery in afternoon trade helped the blue chip index record a weekly gain of 2pc, its first in one month.

Meanwhile, the FTSE 250, which is considered a closer barometer of the UK economy, suffered its worst day since Black Monday in October 1987, tanking 7.2pc.

From a markets perspective this is not a systematic Lehman moment.Ian Richard, of Exane BNP Paribas

Chris Beauchamp, of IG, warned ripples of the UK’s decision to withdraw from the EU would be felt across the globe “for a long time to come”. Meanwhile, French Bank Societe Generale forecast the FTSE 100 and 250 could fall by 15 and 20pc respectively in the coming days.

Although the knee-jerk reaction from markets was one of aggression, Ian Richard, of Exane BNP Paribas, said: “From a markets perspective this is not a systematic Lehman moment.”

The market carnage “wasn’t just a UK story” analysts at UBS said. Attempts to battle Brexit-inspired financial contagion were unsuccessful, as European bourses faltered. “The eurozone was the most impacted on fears an exit will accentuate any anti-EU movements,” said Karen Olney, of UBS.

Frankfurt’s DAX and the CAC in Paris tumbled 6.8pc and 8pc, respectively. Meanwhile, the Spanish IBEX and Italy’s FTSE MIB both suffered their worst daily losses on record, slumping 12.4pc and 12.5pc, respectively. Shares in Greece also nose-dived 13.4pc.

In the US, the S&P 500 recorded its worst opening since 1986 and the Dow Jones industrial average surrendered more than 500 points in intraday trade.

Back in London, the number of trades processed hit an all time high of 2.7m and trading turnover reached £14.2bn, its highest level since the Lehman Brothers crash in 2008, when volumes soared to £22bn.

Investors dumped banking stocks as the sector, which generates exports of £23bn to the European Union, became one of the biggest Brexit casualties.

Traders remained on edge as Simon Hunt, UK head of banking and capital markets at PWC, cautioned that banks will now have to consider retaining their position in the EU. While the consequences of Brexit are unknown, Deutsche Bank chief executive John Cryan warned: “There’s no doubt that they will be negative on all sides.” In its wake, shares in Lloyds tumbled 20.9pc, Royal Bank of Scotland tanked 18pc, Barclays dropped 17.7pc, HSBC fell 1.4pc and Asia-exposed Standard Chartered slipped 2.6pc.

Elsewhere, the prospect of a weaker UK economy following an EU exit triggered a sell-off in housebuilders. Shares in Taylor Wimpey plummeted 29.3pc, Persimmon fell 27.6pc and Barratt Development slumped 23.8pc.